Calculate the break-even point in units Calculate the percentage by which the budgeted sales can fall before the company begins to make a loss. The Marketing Manager has suggested that the selling price per unit can be increased to $25 if the sales commission is increased to 8% of selling price and a further $10,000 is spent on advertising. calculate the revised break-even point based on the marketing manager's suggestion
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A company manufactures a single product. Budget and
selling price per unit; $24
variable production cost per unit; $8.60
fixed production cost; $650,000
fixed selling and distribution costs; $230,400
sales commission 5% of selling price
sales 90,000 units
REQUIRED
- Calculate the break-even point in units
- Calculate the percentage by which the budgeted sales can fall before the company begins to make a loss. The Marketing Manager has suggested that the selling price per unit can be increased to $25 if the sales commission is increased to 8% of selling price and a further $10,000 is spent on advertising.
- calculate the revised break-even point based on the marketing manager's suggestion
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